Marketing of Emirates Airlines - Essay Example

? Marketing Final Term Table of Contents Part one 3 Introduction 3 Target market 3 Goals 5 Part two 5 Marketing mix 5 Part three 12 Emirates Positioning Points 12 New Positioning Statement 13 Part four 14 Marketing Budget and Implementation 14 Marketing budget and time frame 14 Reference 16 Bibliography 17 Part one Introduction Emirates Airlines is an airline which is based in Dubai at the Dubai International Airport, United Arab Emirates. In the Middle East, it is the largest airline. It was established by the ministry of Dubai in the year 1985 with just purely two aircrafts. Emirates expanded its empire after two decades in more than 55 countries with 83 aircrafts who are soaring to 78 destinations worldwide. Among the cabin crews, Emirates Airlines has one of the largest numbers of cabin crews which hail from around 95 different nationals. Emirates Airlines has installed individual entertainment system in all of its classes enabling customers for not only making online booking but also facilitates for choosing their arena of seating. These outstanding features have enabled this airline to be a customer oriented and pioneering contributor for advanced services. Emirates Airlines have empowered over 280 international awards, among which the prestigious award has been CAPA airline award for the year 2005, as awarded by the Centre for Asia Pacific Aviation. Target market Targeting the kid’s market The needs of kids can be used to increase the share of market. There are a lot of families and parents who cares for the needs of their kids much more than themselves. Offering a suitable and comfortable environment to kids can reduce the misgiving of families. After launching of the campaign of “kids go free”, more family groups were received by Emirates Airlines than before. Through cooperation with tourism companies and hotels in Dubai, the emirates are keen to attract large number of tourists. The parents are also willing to take their kids and enjoy affordable travel with Emirates Airlines. The kids friendlier environmental can provide pleasure to kids for having a great time with their parents in Dubai. Now, the focus is more towards the kids market as the kids can influence the decision of parents. UAE’s tourism and business segment customers The emergence of Dubai as a tourism hub and regional business has provided Emirates Airlines to fuel the traffic of regional air passenger enabling abundance of room for growth. The law of freehold ownership has been attracting tourists and business communities. Expatriates in UAE UAE, being 5th largest crude oil exporter of world and Dubai, being the fastest growing city of world, has created huge demand for skilled and unskilled workforce for feeding its emerging labour market and booming economy. A major attraction for various workforces around the world is its highly paid labour market. So, Emirates Airlines targets the expatriates in UAE. Transit passengers For Emirates airlines, Dubai is the operational hub. It has been positioned as a connector between Australia/ Asia and Europe and has supported the growth of emirates airlines. This connection point has been used by Emirates airlines to promote the business, especially transit passengers. Emirates airlines target to prosper in this particular segment through marketed and well established wide range network. Goals Emirates Airlines focuses towards maximizing the return on capital of overall Group, to take full advantage of the competencies of Group in market and to be diverse and balance to the earning streams of Group. The objectives pertaining to the fulfillment of these goals are to improve and retain the market share of frequent business class traveler, to tap the market of low cost carriers for achieving the return on investment of company, to promote the tourism activities of Dubai and to introduce Dubai to the world and to increase the market share. Part two Marketing mix The Emirates Airlines hold an extraordinary achievement during the previous years. However, during 2009 which was one of the worst years in airline history, the emirates airlines reported a billion dollar profit and remained one of the fastest growing and most profitable airlines in the world. As Emirates aggressively makes entry into new markets, demonstrates leadership in the passenger service of high quality and expands others, the influence of Emirates on the competitor airline strategy continues to increase. The development of Emirates has contributed to the stream of Dubai through the rankings of world’s biggest international hubs from the position of 26 in 2001 when it was handling international passengers of 12.4 million to the position of 6 in 2009 handling international passenger of 40.1 million. The marketing mix can be defined as a set of controllable variable which is blended by the firm to produce the response required in its target market. It can be described as the way of offering the products and services by the enterprise to its target market. The marketing mix is defined by 4P’s model. The overall objective and aim of 4P’s model is allowing the organization for building and sustaining a competitive advantage in market place. The 4P’s are normally used in the formulation of marketing strategy as the model is supposed to be flexible enough which can be integrated in different combinations for fulfilling the proposed objectives. Integration of marketing mix Product Product refers to physical product or service which is offered to the consumer. In case of physical product, it is referred to any conveniences or services which form the part of offering. The decisions in respect of product include aspects like brand name, styling, functionality, safety, quality, repairs and support, packaging, accessories and services and warranty (Kotler, 2009, p.110). Emirates Airline offers the latest and high quality services and technologies to their customers. It is the first airline to show the updates of flights in the BBC world news. They are the first to provide the ability to travelers to receive and send Sms messages and emails from any class and also they are the first airline implementing TVs in all its classes. They are the well known flights for their security and safety of high standard as they have implemented many safety systems and security programs. However, the company has also gained a wide esteem for their email services to all its passengers. In their aircrafts, they also allow live text news for their customers. In addition, the Emirates are the first among the airline company of Middle East who have introduced a digital widescreen system in 2005. This particular service has not been provided by any other airline companies of the world. The Emirates Group has its businesses in respect of air transport, call centre, airport aviation services like catering, hotels and resorts, freight forwarding and logistics, engineering services, airport meet and greet, air cargo support services, sports and club facilities, IT solutions, risk management and security, retail, travel, tour operator and events management, training, retail, food and beverage, loyalty and reward programmes, ground handling, cargo services and travel. Selecting a particular product like air cargo support services, this service of Emirates Airlines consists of calogi, Dnata-PWC Airport Logistics LLC and cargo partners. Calogi provides a one-stop communications platform connecting the airfreight industry with the opportunities of business. Dnata-PWC Airport Logistics LLC is a specialist in road haulage which provides transportation of goods from different airports to proper destinations across the region of Middle East. Cargo partners are the arm of general sales and services of dnata Cargo which provides support to more than 30 airlines in Dubai. The main competitors of Emirates are British Airways, Lufthansa and Air France. These airlines provide comparable and superior service in the flight experience. Among these, the primary competitor is British Airways. But the air cargo support services of Emirates Airlines are quite competitive and better than British Airways in terms of their services. To grab a huge share of market, the air cargo support services of Emirates Airlines has to provide more better and enhanced service to its customers. Also the technologies and services provided by Emirates Airlines are quite sustainable as it provides social, environmental and economic benefits protecting the environment and public health in the entire life cycle. Price In terms of price, the strategy of premium pricing is used by Emirates Airlines which offers a higher price than the price offered by other airlines in the market. This strategy is used by Emirates Airlines as it serves high quality and luxurious excellent services to their customers who merit greater money than the other airlines who offer services of regular standard. However, this strategy is used by them as they target people from medium income level to high income level who want to make more payment for availing better services. I will adopt the strategy of psychological pricing by designing the prices in a way to obtain a positive psychological impact from customers. The prices will be designed in a way so as to hit the psychology of consumers directly. The target will be to reflect a positive image in the consumers mind with regard to the price. The flight fare from New York to Dubai is USD 1600. However, if I adopt the psychological pricing strategy then I will set the fare at USD 1599. The competitive price in respect of British Airways is USD 1615. Place Placement or place decisions are the decisions which are associated with the channels of distribution which serve as the mean for making the availability of product to the target customers. The logistical, transactional, and functions of facilitation are performed by the distribution system. The decisions in respect of distribution include specific channel members, distribution channels, warehousing, inventory management, and market coverage including exclusive or selective distribution, order processing, distribution centers, reverse logistics and transportation. In the United Arab Emirates, Emirates Airlines consists around eleven travel shop branches. It has 122 branches outside United Arab Emirates providing superior services all around the world. In addition to the physical distribution shops, Emirates Airlines also has an online website which has been presented in nine languages to reach to all its target segments that belong from different nationalities. The customers can make booking for their flights through the website and can check the latest offers. They can also make a booking for their accommodation in a hotel during their travel. To provide good services to customer, Emirates Airlines has to expand its operation within and outside United Arab Emirates to reach to wider consumer segment. The number of travel shop branches within and outside United Arab Emirates should be increased. This will increase the level of competition within the airline industry. If the distribution pattern can be enlarged, it will lead to more profitable business and grabbing of larger market share. Further, increase in market share of Emirates Airlines than its competitors can enable to achieve brand loyalty and wider market segment and more profitable operation in its business. Promotion The decisions of promotion are those which are related to selling and communicating to potential consumers. These costs can be larger in proportion to the price of product. So, a break-even analysis is required to be performed while making decisions on promotion. Knowing the value of customer is useful in determining if additional customers are worth the cost of its acquiring. The various aspects of marketing communication are represented by promotion. In other words, it communicates information about product with the target of generating a positive response of customer. The decisions in respect of marketing communication include advertising, sales promotion; personal selling and sales force, promotional strategy like push or pull, marketing communication budget, public relation and publicity. Varieties of methods of promotion are used by Emirates Airlines which fits their budget. For advertising, it gives advertising in newspaper to attract its segment like Gulf news and in cheap magazines like Ahlan. It also uses billboards which is a good tool for advertising. It is attractive and can be seen by people everywhere. While making advertisements, they write the advertisements in simple language which can be understood clearly. In terms of sales promotion, they offer privilege card to its customers where more benefits are given to the customers on travelling more miles like offering free ticket at Emirates Airlines. Such offer increases the loyalty of their brand. However, the planned promotional activities and media are personal selling, public relation and marketing communication budget. Public relation can be defined as the practice of supervising and managing the communication of information between an organization or an individual and public. Public relation includes gaining of exposure by an individual or organization to its audiences through news items or topics which are in the interest of public and does not require direct payment. The motive behind public relation by an organization is to persuade the investors, employees, partners, stakeholders and public for maintaining a positive outlook about the organization in the mind of public and also a positive outlook in respect of its products, leadership and political decisions. The activities related to public relations include working with press, speaking at conferences, communication with employee and winning industry awards. Emirates Airlines are required to maintain a proper relation with its public so as to influence them towards the services offered by this airline company. However, there are specific tools, methods and tactics of public relation. Specific disciplines in the field of public relation include crisis communication which refers to make a response during crisis, financial public relation which refers to communicate business strategy and financial results, and internal communications which refers to make a communication within the company, lifestyle/consumer public relation which refers to gaining publicity for particular service or product and government relations which refers to the engagement of government departments for influencing public policy. Each of these disciplines include typical activities like press releases, publicity events, newsletters, speaking opportunities, social media, blogs, outbound communication to the press members, releases of audio and video news etc. The system of public relation includes appointing a public relation practitioner who can manage and build relationship with the target audience of the organization. The public relation practitioner is required to accumulate various relationships which can become an asset to the organization. This public relation practice should be run by Emirates Airlines in its areas of operation to motivate the customers or target audience towards the services offered by this airline company. Audience targeting is a fundamental technique which is used in public relation for identifying the target audience and for tailoring messages to them to make appeal to each of the audiences. Sometimes, several distinct messages but complementary are required to be created if the interest of stakeholders and differing audiences are common to the effort of public relation. The theory of stakeholders, on the other hand, identifies such people who have a stake in a given issue or institution. All the audiences are stakeholders but all the stakeholders are not audiences. Messaging is the process of creation of a consistent story about a company, product, person or service. The aim of messaging is to avoid confusing or contradictory information which installs doubt in the purchasing choice or any other decision that can have an impact on the company. The technique of public relation can cost around $ 3000. Part three Emirates Positioning Points The Emirates Airline positioning points considers issues of quality, price, demand and comfort. This has been outlined below by aligning Emirates to its competitors in the Australian market. The three significant competitors in Australia air travel market include Virgin Blue and Qantas Airways based in Australia where Emirates also has operations. A positioning map provides a useful way for corporations to compare their services to others in the market and determine the way theirs fits in the market (Fisher, Pride & Miller 2006). The map shows two variables that have an impact on customer decision or that contribute to the company being higher than its competitors in the market are. For example, a map may show against the y-axis quality, and x-axis price, with the companies placed to show whether they rank low or high on these factors such as shown in the three position maps illustrated below. Quality versus Price Position Demand versus Price Position Comfort versus Price New Positioning Statement The desired Emirates Airline position statement is that the company is the leading air carrier in the Middle East and the world with a large destination network of more than 110 destinations globally. The new positioning statement is derived from the determined corporate objectives, which are based on actual activities and proposed activities. Among the objectives are Emirates growing the global destination network to 110 destinations from the current 100 destinations. Further, the position reflects the positions represented in the maps, showing Emirates is a significant leader relative to its key competitors. Part four Marketing Budget and Implementation Marketing budget refers to the process of setting the goals of budget and implementing the ways of allocating the marketing expenses accordingly. After developing the marketing plan that supports the goals of company, it is required to make its implementation. The budget for this plan will include the marketing creation of literature which will be sent through regular mail to customers. This literature will also be provided online at the website of the company with additional links to associated bonuses and benefits. It will also be provided in the face book targeting campaign of the company through the page and through face book advertisements which allow the potential customers to click through and purchase a ticket. QR codes can also be generated for each verified customer who can receive their coupons through the code itself or pick up those 25%-10% coupons at the ticket counter, whichever is convenient for them. The pass for one night’s stay at the hotel can also be generated through the QR code or through a coupon picked up at the ticket counter. Marketing budget and time frame Time frame Action Beginning date Completion date Document design and creation 5-May-13 Two weeks Design of ads, face book and QR code system generator 5-May-13 One week Hard copy mailings 21-Jul-13 1-Aug-13 Journal/ Industry advertisement placements 1-Jul-13 1-Aug-13 Marketing budget (AED) Hard copy printing cost 10000 Ad creation for journal/ industry publications 5000 Ad placement fees 15000 Website development for click through purchasing 9000 Social media development: QR codes and face book 10000 CRM integration with all points of purchase 15000 Business document development (white papers, case studies) 30000 Business videos (DVDs) 20000 Reference Kotler, P., 2009. Marketing management. India: Pearson Education India. Bibliography Aircraft Avionics, 2012. Aircraft Maintenance Engineering Vocational Programmes And Top-up Degrees. Available at http://www.emiratesaviationcollege.com/engineering_amc.aspx. [Accessed on April 30, 2013]. Dubai Hub, 2012. Dubai to Become new International Hub for Qantas European Operations. Available at http://www.emirates.com/english/about/news/news_detail.aspx?article=972231. [Accessed on April 30, 2013]. Ferrell, O.C., Hartline, M.D., Lucas,Jr., G.H. & Luck, D., 1999. Marketing Strategy. Philadelphia: Dryden Press. Kennedy, D.S., 2006. The Ultimate Marketing Plan. 3rd ed. Massachusetts: Adams Business Press. Waugh, R., 2012. World’s biggest super-jumbos must be grounded, say engineers after cracks are found in the wings of three Airbus A380s. Available at http://www.dailymail.co.uk/news/article-2084242/Airbus-A380-Worlds-biggestplanes- sky-worthy-say-engineers.html. [Accessed on April 30, 2013]. Read More